[The following information applies to the questions displayed below.] The following transactions apply to Park Company for Year 1: 1. Recelved $50,000 cash from the issue of common stock. 2. Purchased Inventory on account for $180,000. 3. Sold Inventory for $250,000 cash that had cost $140,000. Sales tax was collected at the rate of 5 percent on the Inventory sold. 4. Borrowed $50,000 from First State Bank on March 1, Year 1. The note had a 7 percent Interest rate and a one-year term to maturity. 5. Pald the accounts payable (see transaction 2). 6. Pald the sales tax due on $190,000 of sales. Sales tax on the other $60,000 is not due until after the end of the year. 7. Salaries for the year for one employee amounted to $46,000. Assume the Social Security tax rate is 6 percent and the Medicare tax rate is 1.5 percent. Federal Income tax withheld was $5,300. 8. Pald $5,800 for warranty repairs during the year. 9. Pald $36,000 of other operating expenses during the year. 10. Pald a dividend of $2,000 to the shareholders. Adjustments: 11. The products sold in transaction 3 were warranted. Park estimated that the warranty cost would be 3 percent of sales. 12. Record the accrued Interest at December 31, Year 1. 13. Record the accrued payroll tax at December 31, Year 1. Assume no payroll taxes have been paid for the year and that the unemployment tax rate is 6 percent (federal unemployment tax rate is 0.6 percent and the state unemployment tax rate is 5.4 percent on the first $7,000 of earnings per employee). Required: a. Record the preceding transactions in general Journal form. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field. Round your final answres to the nearest dollar.) View transaction list Journal entry worksheet Reg A1 Reg A2 Reg A3 Reg B1 Reg B2 Reg C What amount of interest expense is reported on Ripley's income statement for Year 1? Interest expense Reg A1 Reg A2 Reg A3 Reg B1 Reg B2 Reg C What is the amount of warranty expense for Year 1? Warranty expense Complete this question by entering your answers in the tabs below. Req A1 Reg A2 Req A3 Req B1 Req B2 Reg C Post the liabilities transactions to T-accounts at December 31, Year 1. Interest Payable Sales Tax Payable Beginning balance Beginning balance Ending balance Ending balance Warranties Payable Notes Payable Beginning balance Beginning balance Prepare the current liabilities section of the balance sheet at December 31, Year 1. RIPLEY COMPANY Balance Sheet (partial) As of December 31, Year 1 Current liabilities Total current liabilities Reg A1 Reg A2 Reg A3 Req B1 Reg B2 Reg C Show the effect of these transactions on the financial statements using a horizontal statements model. Use + for increase, - for decrease, and leave blank for not affected. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA), investing activity (IA), financing activity (FA), or not affected (leave blank). The first transaction has been recorded as an example. (Not all cells require input.) Show less RIPLEY COMPANY Horizontal Statements Model Balance Sheet Income Statement Event Statement of Cash Flows Assets Stockholders' Liabilities Revenue Equity Expenses = Net Income 1 FA + + + 2. 2 + + 3 4 5. 6 7. 8